–Emerging Markets:Ken Rogoff asks just how fragile are emerging markets? “Emerging-market equities and exchange rates are again under severe downward pressure, but are the underlying economies really as fragile as global traders seem to fear? The short answer, for a few, is probably “yes,” but for most, “not just yet.” For most countries, what we are seeing is a recalibration as investors incorporate the risk that China’s GDP might rise more slowly, the US Federal Reserve might start tightening monetary conditions more quickly, and policy backsliding in many countries might undermine potential growth.”

–Output Gap:Menzie Chinn takes a look at how far GDP is from its potential. “The CBO released Budget and Economic Outlook on Tuesday. As part of the report, the CBO released its estimates of potential GDP in a manner consistent with the new GDP measures that incorporate intellectual property in the investment data. The output gap remains large and negative, using these updated estimates. Note that by 2013Q4, the output gap is -4.3% (log terms), and taking the mean WSJ survey response, the output gap at 2014Q4 is -2.9%. Even with the high estimate of GDP growth (after trimming the sample by 20%), the gap is -2.4% (Joseph Carson/Alliance Bernstein), whereas the low (after trimming) forecast indicates a -3.7% gap (Julia Coronado/BNP Paribas). The CBO projection (under current law, and based on data available as of December 2013 and the 2013Q3 second release) is 3.3%.”

–American Dream:Dan Kadlec looks at how millennials are putting their stamp on the American Dream. “Every generation puts its stamp on the American Dream. But none have re-engineered the term quite like Millennials, who mostly want to travel and not work slavishly for the man… In a new poll, 38% of Millennials say travel is part of the American Dream, exceeding the 28% who name secure retirement. They identify the dream of home ownership at a far lower rate than Gen X and baby boomers. Meanwhile, 26% of Millennials cite self-employment as part of the dream—more than Gen X (23%) and older boomers (16%), according to MassMutual’s third biennial study The 2013 State of the American Family.”

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